National Assembly Warns of Delay in Won Stablecoin Launch… Will Global Leadership Be Lost?

Warnings have been raised in the National Assembly that Korea could lose market leadership as global regulatory competition intensifies while discussions on introducing a Korean Won stablecoin are delayed. It is pointed out that unlike overseas markets where the institutionalization of stablecoins is accelerating, the domestic system remains stuck in the 'design phase.'

“If we’re late, we’ll fall behind”… Warning issued in the National Assembly

At a National Assembly seminar, concerns were focused on the delays surrounding the introduction of Korean Won stablecoins. Kim Tae-rim, Managing Partner at Axis Law Firm, stated that a review is needed to determine whether delaying legislation due to concerns regarding monetary sovereignty and financial stability is appropriate. In particular, he emphasized that Korea must accelerate the establishment of stablecoin regulations, given that the implementation of the U.S. 'Genius Act' and the regulatory framework in the UK has become a reality.

Kim Yong-hwan, former chairman of NH NongHyup Financial Group, also mentioned the possibility that discussions on the Digital Asset Framework Act, the so-called second phase of virtual asset legislation, might be postponed until after the local elections in June, warning that “if we do not actively push for it now, we could fall behind in the global market.”

Currently in Korea, the relevant bill remains at the review stage of the National Assembly's Political Affairs Committee, and discussions have continued for over a year since the 2024 presidential election pledge.

Bank-centric structure vs. industry backlash

The key issue is the issuer of stablecoins. The government maintains that stability must be secured through a 'bank-centered (50% + 1 share)' structure, but the industry opposes this, arguing that such a structure could lead to market contraction and inefficiency.

Dollar-based stablecoins have already established themselves in the domestic market with an annual trading volume of approximately 57 trillion won, effectively securing the lead. In a sense, overseas issuers have been expanding their substantial influence while regulations were not properly established.

The Bank of Korea also prioritizes Central Bank Digital Currency (CBDC) and maintains a cautious stance on stablecoins, so policy directions remain divergent.

“Must move beyond the issuance debate”… Need to expand payment infrastructure

Experts point out that discussions on an integrated structure are needed that go beyond the debate over the issuing entity and include on-chain payment networks, Real-World Asset Tokenization (RWA), and Security Token Offerings (STO).

Yoo Je-hoon, former president of the Korea Deposit Insurance Corporation, emphasized, “We must move away from issuer-centric discussions and simultaneously build a payment infrastructure that can be actually utilized.” This means that stablecoins should be expanded beyond a mere payment method into a digital financial infrastructure.

Whether discussions on the bill resume is a turning point.

Rep. Kim Sang-hoon of the People Power Party stated that he would put the Framework Act on Digital Assets on the agenda for formal review immediately after the local elections and continue discussions, but the actual pace remains uncertain.

Ultimately, the introduction of a Korean Won stablecoin has become a matter of finding a balance between 'regulatory stability' and 'market competitiveness.' With global stablecoin regulations and markets rapidly becoming established, assessments suggest that if Korea fails to overcome its current lag, it is difficult to rule out the possibility of ceding leadership in digital assets to overseas entities.